5 reasons why Hyatt needs a premium credit card — and what it might look like
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There are two main reasons why I have 14 credit cards: Generous welcome offers and ongoing perks.
In its current iteration, the $95-per-year World of Hyatt Credit Card is one of the best all-around travel rewards cards on the market. It’s a card that I not only have, but it’s one that continuously gets a spot at or near the front of my wallet. Spending on the card provides me tangible value as it comes with a free night every year, valid at Category 1-4 properties across the entire World of Hyatt umbrella and an additional free night certificate when you spend $15,000 on the card in a cardmember year.
Riding on the coattails of this popular World of Hyatt product, what if Hyatt allowed members to supercharge their loyalty with an additional card option?
It’s not a totally novel concept, with both Marriott and Hilton offering premium cards. However, now is the time for Hyatt to provide a means to earn more points and benefits than ever before, in a way that doesn’t dilute perks for existing cardholders and Hyatt elites. That could include accelerated ways to earn top-tier Globalist status (but not providing it outright), new credits that encourage trying premium Hyatt brands and more.
Here are five reasons why a premium World of Hyatt card makes sense — and what that card might look like.
Chase lacks a premium hotel card offering
For years, rumors have swirled about a premium cobranded Hyatt credit card that would take on the likes of the Hilton Honors American Express Aspire Card and Marriott Bonvoy Brilliant™ American Express® Card. As their names imply, both of these competing hotel chains’ cards are issued by Amex (although Chase also issues some other Marriott cards).
Overall, Chase doesn’t have a solid grasp on the premium card market. It lacks a premium hotel cobranded card and its only other cobranded premium products are with United Airlines. While the high-end Chase Sapphire Reserve got a mini-refresh earlier this year, it has lost some of its luster over the years compared to other products, such as the issuer’s own Chase Sapphire Preferred Card.
Launching a more expensive World of Hyatt credit card is one way for Chase to remain competitive in the booming premium card market. Chase’s main competition here is Amex, a company that has not one, but two, premium hotel cards, among the other offerings in its portfolio.
Amex has a strong reputation in the industry, winning J.D. Power’s Customer Satisfaction survey two years in a row. That includes winning in the categories of “benefits and services” and “rewards and key moments,” areas where Amex particularly excels. A premium Hyatt card could cut into Amex’s lead.
The information for the Hilton Aspire card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Cardholders are willing to pay a premium
It might come as something of a surprise, but some of the most buzz-worthy rewards cards on the market right now are premium cards — ones that charge several hundreds of dollars in annual fees.
Take The Platinum Card® from American Express as a prime example. The Amex Platinum received a wholesale revamp earlier this year, with Amex tacking on new benefits and a new, higher annual fee of $695 (see rates and fees). Despite that fee hike and a somewhat dizzying array of statement credits to keep track of, the appetite for this card has seemed to remain high.
“Demand for our premium fee-based products accelerated this quarter with acquisitions of U.S. consumer and small-business Platinum and Gold cards well above 2019 levels and exceeding prior quarters,” said Steve Squeri, chairman and CEO of American Express, in this quarter’s 2021 earnings call.
In addition, with new airport lounges opening over the next several years, both Chase and Capital One are significantly investing in new premium experiences for their cardmembers. These are audience segments that Amex has long had a stranglehold on, but competition is heating up.
A premium Hyatt card with Chase, therefore, fits into this equation. After all, if cardholders are willing to pay a premium for travel-related perks, why not give them new cards to pay for?
Hyatt elite perks are highly coveted
Hyatt has one of the most impressive loyalty programs in the hotel industry with a generous award chart and perks aplenty.
World of Hyatt elite status is a standout for customer-centric service and perks worth the effort in obtaining. Top-tier Globalist status usually requires 60 qualifying nights per year, but with the reduced requirements for 2021, you can achieve it with 30 nights. It’s one of the most sought-after elite statuses, with compelling benefits such as suite upgrades, guaranteed 4:00 p.m. late checkout, free breakfast, and more.
Hyatt points in general are also quite valuable thanks to reasonable award night redemption rates. You typically need fewer points to redeem for stays compared to the competition and according to TPG valuations, Hyatt points are worth more than the likes of Marriott, Hilton, and IHG.
While I can’t envision a world where Hyatt is going to dole out Globalist status to every premium cardholder, I can see how a new card product could make it easier to obtain that status level.
One option would be to provide additional elite nights compared to the existing World of Hyatt credit card. That card offers automatic first-rung Discoverist status plus five qualifying night credits each calendar year — in case you achieve status through staying but could use the help getting to that next tier. Cardholders earn two additional elite night credits every time they spend $5,000 on the card in a calendar year.
With a new premium card, Chase and Hyatt could offer automatic Explorist status plus a simple one-tier status boost based on card spending, much as you find with the Marriott Bonvoy Boundless Credit Card, also from Chase.
Folks with the Boundless receive 15 elite night credits per calendar year, which is enough for automatic Marriott Bonvoy Silver status. But those who use the card to make $35,000 or more in purchases per calendar year get a boost to Gold status. With a premium card, Hyatt could incentivize potential cardholders to put continuous spend on their card, in order to reach a status boost to Globalist.
Overall, the goal of a premium card would be to entice more World of Hyatt members to go after top-tier status. At the same time, Chase and Hyatt would need to be judicious in creating a product that encourages card usage but doesn’t make it too easy to earn Globalist.
Hyatt’s footprint is growing quickly
With just over 1,000 properties, Hyatt is the underdog in the world of hotels, with a much smaller brand than Marriott (over 7,000 properties), Hilton (over 6,500 properties) and IHG (nearly 6,000 properties).
But Hyatt is making significant strides to grow its worldwide footprint through both partnerships and acquisitions. It recently bought Apple Leisure Group to bolster its resort presence, and Hyatt’s acquisition of Two Roads Hospitality in 2018 added upscale boutique brands such as Alila, Destination Hotels, JdV by Hyatt and Thompson. This doesn’t even include Hyatt’s Small Luxury Hotels partnership, with hundreds of independent hotels worldwide.
With an expansion and more properties coming, it’s only to be expected that Hyatt would want to continue growing its customer base further and foster more loyal followers with a premium Hyatt credit card.
Hyatt is clearly focusing on the luxury and independent segment with these partnerships and acquisitions. Therefore, a premium card may have specific perks tied to those brands. For instance, the card could have a specific property credit for the Alila or Park Hyatt brands, similar to how the Hilton Aspire has an up to $250 annual credit at Hilton Resorts properties, or the Marriott Bonvoy Brilliant allows cardmembers who book a special rate to get up to $100 in statement credits on stays of two nights or more at St. Regis and Ritz-Carlton properties.
The industry is rebounding and business travel will return
At the height of the pandemic, issuers peeled back their willingness to approve applicants, citing the risky economic environment. But within the past year, we’ve seen a complete 180-degree shift.
Elevated welcome bonuses have returned with a vengeance and the increased investment from issuers for new customer acquisitions (instead of just retaining existing customers) bodes well for the future of the credit card business.
And while the COVID-19 delta variant has significantly slowed the full return of business travel, there’s no doubt that a comeback is looming. For instance, Delta Air Lines said U.S. corporate travel returned to about 40% of pre-pandemic levels this past summer, although a complete recovery isn’t expected until 2024.
A premium Hyatt card fits into the notion that, along with travel, rewards cards will make a full-fledged comeback. For Chase, that means there’s less risk now than a year ago in launching a new card, especially a premium one.
In addition, the card will be set to capture a share of the business travel audience once those travelers fully get back on the road. Many business travelers — especially frequent ones — are big spenders that value perks that Chase and Hyatt might deliver with a premium card, including higher levels of elite status that will make both their work and personal trips more enjoyable.
What a premium Hyatt card might look like
Now, for the fun part: What could a premium Hyatt card look like? First, I want to reiterate that TPG doesn’t have any information on if a new Hyatt card is in the works. But the opportunity is undoubtedly there.
The existing $95-per-year World of Hyatt card currently offers the following perks:
- 4 points per dollar on Hyatt stays
- Annual free-night certificate at a Category 1-4 Hyatt property
- Ability to earn another Category 1-4 free-night certificate after spending $15,000 in a calendar year
- Automatic Discoverist elite status
- 2 p.m. late checkout upon request
- Preferred room upgrades
- 10% points bonus
- Earn elite nights toward status, two nights for every $5,000 spent on the card
Besides a higher annual fee, a premium Hyatt credit card would need to provide additional benefits.
I’d imagine a card with at least a $400-per-year fee to include a free night certificate, but perhaps one that includes up to Category 7 Hyatt hotels (instead of just Category 4). Mid-tier Explorist status would seem likely too, with the ability to earn Globalist from hitting a spending threshold, or at least additional elite nights based on spending.
Like the Hilton Aspire and Marriott Bonvoy Brilliant, I could see Hyatt also offering a resort or specific property credit in some shape or form, perhaps in the $100 to $200 range. A suite night award or two could be in the cards too (pun intended). Finally, since this would be a premium Chase card, it would likely be branded as a Visa Infinite card and the associated benefits that come along with it.
A cobranded credit card should complement its loyalty program, and the existing World of Hyatt card does just that. But there’s an opportunity for Hyatt and Chase to do even more together.
Given its growing luxury footprint and strong elite program, World of Hyatt could benefit from launching a premium card that carries an annual fee of several hundred dollars. Until that day, it’s still an excellent time to apply for the World of Hyatt card already on the market, while elite status qualifications are halved for the remainder of 2021.
For rates and fees of the Amex Platinum card, please click here.
For rates and fees of the Marriott Bonvoy Brilliant card, please click here.
Featured photo of the Park Hyatt Aviara by Chris Dong/The Points Guy.
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